Monday, August 22, 2011

My advice, should you choose to take it...

This tape will self-destruct.

Ten years ago, I wouldn't have presumed to give anyone advice about business. I was coming out of some disastrous business decisions (mostly related to over-expanding and bubbles, sound familiar?). I was still deep in debt.

Oh, sure. I could've given advice based on "what not to do" which would have been valuable, but who would listen?

I probably still need to point out basics like -- I may be wrong. Your mileage may vary. In my humble opinion.

But there are so many missteps that I see small businesses make, that I feel like I need to point out alternative ways of doing things.

I made most of the beginner mistakes -- but fairly early on, I ran across a book called "Growing a Business" by Paul Hawken, who advised that you grow your business within your means, that you don't get caught up in accouterments, and that you focus on basics. Sure, he was a promotional type of guy -- his book was proof of that, but my leanings against promotions came later.

I tried any number of advertisements and promotions, and I'll be damned if any of them really worked. At least, if you start adding up the time, energy, space, and money costs. Not to mention the complications and stress.

I'd drive all the way over the Portland to make a few hundred bucks at a convention, until I came to my senses. I'd add up the costs of staying late in order to host tournaments, or special events. I'd add up the costs of advertising and try to discern even the slightest benefit. I'd wrestle the online auction world, only to come away frustrated with minimal results. (Strange how I would always come up short at the end of the month at exactly the same amount that I spend on advertising; even stranger that I stopped coming up short at the end of the month when I quit.)

Another beginner mistake I made was to keep my prices artificially low. I had a perfect opportunity to charge suggested retail price (SRP) for sports cards during the five years I more or less had a monopoly. I probably charged about 20% less than I should have -- I did not foresee the day when a 20% discount would no longer be enough -- nor a 30% discount, or a 40% or a 50%. No, I had to pay people to be customers.

I also learned my lessons about bubbles. Sport cards, comics, magic, non-sports cards, beanie babies, pogs, Pokemon, all exploded in size and then collapsed, leaving wreckage. I became so attuned to it, that I could see the housing bubble a mile away, and prepared for literally years for the day when it would all come tumbling down.

Anyway, much of my advice is directed to people so that they can avoid making the same mistakes I did. I feel more comfortable about giving that advice since the last 5 years have been among my best years, profit-wise, despite it being the biggest downturn since the Great Depression.

I also had to opportunity, with my wife Linda, to open a used bookstore, The Bookmark, where we were able to have a fresh start, and apply all the lessons we had learned.

And darned if it didn't work.

So again, I remind people it all IMHO and YMMV advice. You can take it or leave it.




6 comments:

Anonymous said...

Gold now $1900/oz,

Note the 'freedom' of Libya not seem to stop the gold bubble.

Good money will always flee an worthless money fall in value. Today almost all 'fear' money is moving to GOLD.

Japan isn't safe, and the SWISS are now taking their money down verbally.

SDR, or SRN, or some kind of new money is on the horizon, as all other paper money now is dis-liked. But GOLD will reverse, because this is a deflationary environment where the GOLD must be sold to buy food.

Another thing to think about is how much of the GOLD is bought by ASIA, I really think that MOST USA purchase is 'idiot' purchase, e.g. ETF or paper gold, which is worthless. Asian people always buy physical gold an generally never sell. At this point the US gold is mostly held in paper, that's why ETF's like 'GLD' are volatile, but GOLD, real physical holds well.

US has a long history of stealing citizens gold. Thus there will never be gold shops on every corner, besides given that the average ameriKKKan has a negative net worth, in fact they don't have any GOLD, they sell their gold at a pawn shop, where it is melted down and exported to Asia, India, or the Arab world.

Anonymous said...

I have long said I would like to once again see a downtown HW store, like we used to have 20+ years ago, near where the old map shop used to be,

I personally would NEVER open a retail shop, I really don't like face-to-face bullshit, dunc loves this shit.

I would like to see more 'useful' biz downtown, even dunc sells useless stuff in my mind, but its a niche.

but the vast majority of downtown biz, is worthless tourist bullshit, local's use this shit? Like we have all said long here, most of these 'fake jewelery' shops are 'owned' by riche women who are bored in Bend. Nobody run's a biz in Bend to make money, they do it as a 'hobby'. Their husbands give them money to keep them out of the house. Sometimes divorced cougars buy a biz, but that shit is gone in a few years.

Sure running a biz in Bend is economic suicide.

Brother Johns little bar/restaurant does quite well on Franklin, small and cheap and many customers. So there are models of 'success' but these are rare.

But all things end, I can remember 20+ years ago when 'westside bakery' was the best place to eat for breakfast in town, I haven't been in now for 15 years, and never see many people there, it used to have a waiting line everyday.

I can honestly say I have been to linda's book store a few times, but have never set foot into dunc's shop :(

Anonymous said...

Harken was terrible cliches,

My favorite was 'what happened to the wooly mammoth?', but I now cannot even find that book on amazon, written in the 1960's by an asshole CPA, that set everything about running a business straight. The only straight talking book I have ever seen on the subject.

This CPA tells the story of why the small ameriKKKan biz became extinct, and who killed it, and how to fight back, but like I have said, that was 50 years ago, and never seen a like book since. Everything that he felt was killing the ameriKKKan dream, is only 1000000000000000X worse today in amerikkka,

Duncan McGeary said...

"Harken was terrible cliches,"

In the land of the blind, the one eyed man is king.

Yeah, I'm pretty sure I'd find it pretty chiche now. But back then, it was mostly B.S. business books and in no way resembled mom and pop biz.

Still is mostly B.S.

Anonymous said...

Debt usually kills small business. Best to avoid it.

Anonymous said...

Nothing like running a biz to really understand the monkey,

Nothing like surviving 5+ years in a biz to really understand that you have exceeded 99% of your fellow men, given that +90% of biz fails the first 3 years,

The problem with all books then ( harken ) and now, is that these books are all a mechanism where some 'kuratek' ( out of town guy in kmart suit ), can sell newsletters or seminars. Today you have 100's of "end of the world" books, and everyone of the goons is on the seminar racket.

Yes its all BS, the ugly truth about running a biz, is not fun, and that the ugly truth, most people want 'feel good' bullshit.

I remember 'harkens' book fairly well at the time, I think it was the time of 'theory-z' and also the time of many 'self-help' books. I'm sure in this depression there will many people writing books about how to run a business.

These days, the problem is NOBODY can tell the truth, the ugly truth about the IRS, and OSHA, .. truth be told 100's if not 1,000s, and at local, county, regional, state, federal, and world-level. Folks like HBM will stay they don't fuck with small-biz, ... I can tell you HBM they DO!

Now to my point, like a witch-hunt, if anybody were to tell the truth, the IRS would fuck them with an audit, anybody who publicly speaks out gets FUCKED everytime, so ergo there is OMERTA ( mob silence ).

Just like ORYGUN, I got out of the landlord biz, largely because I got tired of getting fucked by tenants and judges, the theory in ORYGUN is landlords can pay, and they do everytime, ... it gets old. :(

Truth be told the USA is seriously fucked, sure you can sell tacos out of your car on the street, but then you would still need a permit from food-safety, ... there really is no way for the 'poor' to even have a biz in present day USA.
Like the lemonade deal even in PDX, where kids are fined $500 for selling lemonade without a permit, the permit is $500, more than the child would gross in a lifetime selling lemonade, ... everything has gone crazy like this where there is no point of even getting off your ass, cuz in every case the game is rigged against those who want to work.
When I was a child 5-15 I had a paper route, had 2 routes and made a ton of money, those jobs are long-gone. Too many things like this are gone.